The Conference Board reported consumer confidence gained in July, although it remains in negative territory overall on a slight improvement in the assessment of the current business and labor markets and a dip in confidence about conditions six months from now.
The Conference Board Consumer Confidence Index improved by two points in July to 97.2, with 100 marking the line between positive and negative sentiments, from a revised 95.2 in June. The Present Situation Index based on consumer consideration of current business and labor market conditions, fell 1.5 points to 131.5. The Expectations Index, based on consumer short-term outlook for income, business and labor market conditions, rose 4.5 points to 74.4.
In all, 20.1% of consumers responding to the survey that underlies the index, said business conditions were good in July, down from 20.5% in June, and 14.3% said business conditions were bad, down from 15% in the month earlier. In a slight gain, 30.2% of consumers said jobs were plentiful up from 29.4% in June, while 18.9% of consumers said jobs were hard to get, up from 17.2% month over month.
Expectations for business conditions six months from now included a positive assessment from 18.4% of consumers, versus 17.1% in June, while 23.3% of consumers anticipate business conditions worsening, although that figure dropped from 24.8% a month earlier.
As for work prospects, 17.5% of consumers expected more jobs to be available in six months, up from 15.9% in June but 25.4% anticipated fewer jobs, down slightly from 25.7%.
Drivers of July’s modest confidence advance were consumers over 35 years old across all income groups, except those with household annual incomes below $15,000. By partisan affiliation, July confidence improved among Republican consumers and remained stable for Democrats and Independents.
in weighing economic conditions in the immediate future, the consumer outlook on stock prices continued to recover from April’s 16-month low, with 47.9% of consumers expecting stock prices to increase over the next 12 months, up from 37.6% three months past. The share of survey respondents expecting interest rates to rise declined to 53% from 57.1% in June as more consumers expected interest rates to fall, at 21.2% compared to 18.4% in June. In six months, 18.2% of consumers said they expect their incomes to increase, up from 17.6% in June while 12% expected their incomes to decrease, down from 12.9%.
A special question the Conference Board asked consumers about the direction of various interest rates. It drew a response suggesting that they largely believe mortgage rates, auto loan rates and credit card rates were more likely to rise than other types of interest rates, the think tank indicated, which emphasized that consumers expect credit card rates to rise the most.
Consumer response to Conference Board inquiries about Current and Future Family’s Financial Situation remained solid, although it deteriorated somewhat in July. The share of consumers expecting a recession during the next 12 months declined slightly in July but was still above the levels seen in 2024.
Purchasing plans for cars and homes declined in July but remained stable on a six month moving average basis. Consumer plans for purchasing big-ticket items came in as mixed, especially for appliances, while plans to buy most electronic goods ticked up slightly.
Consumers’ intentions to purchase services weakened for a second month, the Conference Board pointed out, adding that almost all services categories slipped. Dining out remained number one among spending intentions in services, but it was among the categories seeing the largest declines in July spending intentions, along with transportation and lodging for personal travel. Vacation intentions also declined in the month as slightly more consumers planned to travel abroad and slightly fewer anticipated traveling in the United States.
“Consumer confidence has stabilized since May, rebounding from April’s plunge, but remains below last year’s heady levels,” said the Conference Board’s Stephanie Guichard, senior economist, global indicators, in consideration of the recent index developments. “In July, pessimism about the future receded somewhat, leading to a slight improvement in overall confidence. All three components of the Expectation Index improved, with consumers feeling less pessimistic about future business conditions and employment, and more optimistic about future income. Meanwhile, consumers’ assessment of the present situation was little changed. They were a tad more positive about current business conditions in July than in June. However, their appraisal of current job availability weakened for the seventh consecutive month, reaching its lowest level since March 2021. Notably, 18.9% of consumers indicated that jobs were hard to get in July, up from 14.5% in January.”
Guichard added that, among write-in responses to the survey, consumer responses demonstrated “tariffs remained top of mind and were mostly associated with concerns that they would lead to higher prices. In addition, references to high prices and inflation rose in July, even though consumers’ average 12-month inflation expectations eased slightly to 5.8%, down from 5.9% in June and a peak of 7% in April. A number of survey respondents mentioned the recent budget reconciliation legislation passed by Congress, referring to it as the Big Beautiful Bill, with some consumers praising its potential positive economic impact and others expressing concerns. However, the bill and its implications were relatively low on the list of themes that consumers were focused on in July.”
